Japan’s Dec Kanto H2 scrap tender price falls for second month

December's Kanto H2 grade scrap tender saw one successful bid at a lower price on the month on both a Japanese yen and US dollar denominated basis on Dec. 11, amid a recent seaborne landscape of softening price sentiment and limited buying interest.

The winning bid was awarded at Yen 42,739/mt ($282/mt) for a 15,000-mt cargo, down Yen 2,441/mt and $12/mt from last month's tender, according to multiple trader sources and Kanto Tetsugen's website.

The 15,000-mt cargo was heard bound for Bangladesh, with the tender price estimated conversion around $290/mt FOB Japan, according to market sources.

The Kanto tender price fell for the second month in a row, with December's price heard receiving mixed reactions from market participants.

While some traders noted that the tender price fell largely within expectations, others expressed that Vietnamese mills might find it difficult to match such H2 price levels.

"[With the recent Kanto tender results], H2 scrap prices are likely to be under pressure," said a Singapore-based trader.

In Bangladesh, some mills were heard to have recently cut steel production amid slow demand and low public sector consumption, contributing to lower spot liquidity in the market, according to market sources.

Some Bangladeshi mills were also heard with high stock levels, and not being a rush to procure for now, noted market participants.

A large bid-offer gap continued to be heard in the H2 seaborne market this week amid limited vessel availability, high freight rates, and muted downstream demand. H2 offers were heard at $330-$335/CFR Vietnam, while bids were heard at below $320/mt CFR Vietnam on Dec. 11.

Domestic FAS collection prices for H2 grade were heard to have declined on week at Yen 40,000-41,000/mt on Dec. 11.

Platts assessed the weekly H2 ferrous scrap price at Yen 43,400/mt ($286/mt) FOB Tokyo Bay on Dec. 11.